New research from the Washington Technology Industry Association shows how wide the gender gap is among the state’s startup founders.
WTIA collected data on 400 active tech companies in Washington that are at least two years old and have raised a seed round investment or more. It found just five percent of companies started by women.
“This gender dataset is both depressing and inspiring,” WTIA CEO Michael Schutzler said via email.
Schutzler said part of the imbalance is due to “bias in venture capital.” A 2016 survey conducted by the National Venture Capital Association and Deloitte found that 11 percent of VC firm investment partners were women. Less than 3 percent of venture capital dollars went to all-women founding teams last year.
But Schutzler noted that “VC bias only explains part of the problem.” While women own nearly 40 percent of U.S. businesses, according to data from the National Association of Women Business Owners, the same ratios aren’t found in the tech industry, he said.
“Women own 33 percent of restaurants and 31 percent of farmers are women,” Schutzler added. “Yet here we are with 5 percent of tech startups led by women. We can change this — media outlets must deliberately highlight our female founders in tech — not as special oddities but as shrewd winners. I know many of them — they ARE stellar leaders — so we should make an extra effort to show them to the world as such! And then our local VCs must deliberately bet on and mentor many more women entrepreneurs. Not one or two, but dozens.”
Schutzler said Seattle “can show the world how this is done right.”
There are local efforts to help increase diversity in companies and the boardroom. Last month, Seattle-based Female Founders Alliance hosted its first-ever “Meet the VCs” event,” where top female investors provided feedback to female entrepreneurs from across the Pacific Northwest.
There’s also The Riveter, a female-focused co-working space in Seattle that just raised $4.75 million to expand nationwide.
On the investment side, Seattle-based Redfin and several venture capital firms last year launched a new initiative that encourages startups to recruit an “independent, diverse board member” within two years of funding.
Mikaela Kiner, the founder and CEO of human resources company uniquelyHR, and Britt Provost, executive vice president of people and culture at Apptio, recently joined the GeekWire Podcast to talk about how the tech industry can turn diversity-related talk into action.
“Make diversity and inclusion a very early part of your culture, your goals and your values,” Kiner advised. “We all know that what gets measured gets done. That cliché exists for a reason. For leaders, you need to talk about this early and often, just like you do other aspects of the company, the product and who you are as a leader. You will probably be tired of hearing yourself talk about these topics and that’s when you’ll know that you’re doing a good job.”
WTIA’s study also examined where local founders went to school. It reported around 1,000 degrees for 654 founders — both undergraduate and graduate-level degrees — with University of Washington leading the way.
“The data is validation that our universities are doing their jobs,” Schutzler said. “They are producing smart, ambitious entrepreneurs who are inventing, building, and creating many new jobs within a few miles of their graduation ceremony. That is how it should be.”
Here’s the top 10:
1. University of Washington, 125 degrees (12.5%)
2. Stanford University, 38 (3.8%)
3. Harvard University, 33 (3.3%)
4. UC Berkeley, 23 (2.3%)
5. MIT, 17 (1.7%)
6. Carnegie Mellon University, 15 (1.5%)
7. Princeton University, 12 (1.2%)
7. Washington State University, 12 (1.2%)
9. Western Washington University, 11 (1.1%)
10. University of Michigan, 10 (1%)